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deduction of interest on loan for construction in house prop

navneet gupta (student article assistent) (53 Points)

08 January 2009

Hello,:)

i want to know that if a person have a residensial property which is self occupied and it was divided in two part having different registration of each part then how much deduction will be allowed under section 24(b) if the amount of interest is Rs 3,20,000?

please reply.

thanx.

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4 Replies

navneet gupta (student article assistent) (53 Points)
Replied 09 January 2009

please reply..

m confused

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Preetham S L (CA Final Student) (94 Points)
Replied 09 January 2009

Since it is Self Occupied Property, the person can claim interest upto 30000 p.a u\s 24(b). Any how that person can claim Rs.1,50,000 ( interest paid must exceed 1,50,000) as deduction if the following conditions are satisfied :-

The purpose of loan is for acquisition or construction of house
The loan is taken from approved financial institutions.
The loan was borrowed after 01-04-1991
If the loan was taken for construction of house, the construction must be completed within 3 years from date of borrowal of loan.

When it comes to the interest which you have paid during the constrcution of house, such amount of interest can be claimed as Pre-Construction Interest for 5 years. The amount qualifying as interest as pre - construction shall be, interest from the date of borrowal till the preceding financial year in which the construction of house was completed.